The development of the multicellular vertebrate embryo is critically dependent upon intercellular communication. In this process, a widespread mechanism is the secretion of protein signals that bind to specific membrane receptors on other cells, initiate signal transduction, affect nuclear gene activity, and alter cell fate(s). Here, we focus on signaling by Nodal (Xnr in frogs), which in embryos of all vertebrates so far studied - fish, frog, chick, mammal (including humans)- is critical for germ layer induction and patterning, and the left-right asymmetric morphogenesis and stereotyped shaping of the internal organs and cardiovascular system. The production and action of potent inducing signals must be precisely regulated, spatially and temporally, to produce the right amounts and types of embryonic tissue. A positive Nodal auto-regulatory loop, and a feedback loop involving a Nodal inhibitor Lefty/antivin that is induced by Nodal signaling, have been defined. We hypothesize that these interdependent loops provide for flexible regulation of the duration and spatial extent of nodal gene(s) expression and function in embryonic tissues. We will analyze these loops functionally and mechanistically using the experimental attributes of the frog embryo. We will: (1) Determine how "Left-Right signals" are generated, transmitted, and act in the embryo. (2) Determine how Xatv modulates Nodal-mediated induction during mesoderm induction and L-R specification. (3) Characterize the processing of Xatv, and determine if differential processing of the Xatv proprotein affects its action on Xnr ligands. These studies focus on a basic inductive pathway regulating cell fate specification and coordinated morphogenesis, and to congenital defects in humans. At a cell biological level, they address the fundamental issue of how one signal affects cell fates during gastrulation, but later acts to regulate the morphogenetic behavior of overtly equivalent cell types.